Title: Remedying Investor Misconduct in Investor-State Arbitration through Third Party Funding
Author(s): Dr. M. Uzeyir Karabiyik (View Profile)
Journal: Indian Review of International Arbitration
Foreign investors are increasingly turning to third-party funders to finance their arbitrations against host states. In the short time that third party funding has been employed in investor-state arbitration, it has created significant controversy over its role in the practice. Despite its practical benefits including elimination of investors' financial distress regarding the costs of arbitration proceedings, several concerns have been voiced against its use. One of these concerns relates to the control the funders have on arbitral proceedings by way of the funding agreement signed between the funder and the investor. Although this control is of an indirect nature, one may contend that equipping a non-party with this kind of power could go against the fundamental characteristics of investor-state arbitration. Yet, what if this contentious power of funders actually has the potential to address a chronic problem of investor-state dispute settlement system? What if the funding agreement that secures the third-party funder's control over the proceedings could be employed as a tool to remediate investor misconduct? Adopting an argumentative approach, this article seeks to address these questions.
Keywords: ISDS; UNCITRAL; Third Party Funding; Investor-State Arbitration; Investor Misconduct
Cite this as: Dr. M. Uzeyir Karabiyik, Remedying Investor Misconduct in Investor-State Arbitration through Third Party Funding, 1 IRIArb 15, 15-25 (2021).
*The views expressed are of author(s) only.